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Santa Maria Sun / News

The following article was posted on September 5th, 2017, in the Santa Maria Sun - Volume 18, Issue 27 [ Submit a Story ]
The following articles were printed from Santa Maria Sun [] - Volume 18, Issue 27

Cap-and-trade extension has mixed local support


When it comes to gauging the business community’s reaction to the recent developments with California’s cap-and-trade program, it depends who you ask.

Mark Schniepp, director of California Economic Forecast in Santa Barbara, told the Sun that the July 17 vote in the state Assembly to continue the program would most likely change little.

“[Cap-and-trade] is not generating the revenues [the legislators] thought it would because businesses have learned to work around it,” he said. “So I think it’s been kind of a failure for the state of California.”

The program—which requires energy providers, suppliers, distributors, and industrial facilities to purchase permits to exceed annual emissions of more than 25,000 metric tons of carbon dioxide—has been at the forefront of debate among state policymakers since it was implemented in early 2012.

The state Assembly passed legislation to extend the program for another decade, with the help of eight Republicans—including 35th District Assemblyman Jordan Cunningham (R-Templeton). And the Los Angeles Times reported on Aug. 23 that the month’s auction for greenhouse emission permits resulted in a sellout and that prices reached their highest level since the program’s inception.

“This reform package will reduce taxes, fees, and regulations by billions a year,” Cunningham said in an emailed statement to the Sun. “It ends the fire tax permanently—saving Central Coast taxpayers millions—[and] revenues from the auction will help farmers upgrade their technology, as well as enable local fire departments to buy new trucks and equipment.”

Cunningham said the reform rolls back regulations and government overreach and instead uses a market-based system for achieving the emissions target.

State officials say they hope cap-and-trade will help California reach a 40 percent reduction in emissions below 1990 levels by the year 2030.

“[The reform package] is far superior to the status-quo, which was command and control regulation by a single unaccountable bureaucracy—the Air Resources Board,” Cunningham added. “The alternative to cap-and-trade would have cost consumers billions more and hundreds of thousands of jobs. This plan protects the economy and the middle-class pocketbooks.”

While economists and legislators have not been shy about sounding off either in support of or against the program, energy companies have been relatively silent on the matter.

The Sun made inquires to nine oil and natural gas producing operators in Santa Barbara County for comment on this story. Only one—Southern California Gas Company, the largest natural gas-distributing utility in the country—responded.

In an email, Public Information Officer Melissa Bailey hailed the developments and told the Sun that the state should act quickly on utilizing other funds to address smog.

“The extension of the cap-and-trade program will ensure cost-effective carbon reductions across all sectors of the energy industry to help the state achieve its climate goals,” she said. “SoCalGas believes that expenditures of cap-and-trade revenues can benefit the environment as well as SoCalGas customers by supporting deployment of cleaner near-zero emission buses and heavy duty trucks, as well as assisting in renewable natural gas development that can help decarbonize the gas system, just as we are decarbonizing the electric system.”

Bailey said lawmakers should take immediate action to allocate Greenhouse Gas Reduction Funds to address “the single largest source of smog-forming pollution in Southern California—heavy duty diesel trucks that have been linked to serious illnesses, like asthma and cancer.”

According to Bailey, the only viable alternative to diesel is zero-emission natural gas engines.

“Switching from diesel to near-zero natural gas engines would reduce smog-forming emissions by 90 percent, and by using renewable natural gas, greenhouse gas emissions can be cut by as much as 80 percent,” she said. “California must act now to achieve the 2023 air quality goals set by the federal Clean Air Act and to provide immediate relief for disadvantaged communities near freeway corridors suffering daily health impacts from diesel trucks.”

The Santa Maria Valley Chamber of Commerce and the Chamber of Commerce of the Santa Barbara Region declined to comment for this story.

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